AAPICO Hitech lowers performance expectations

Via THE NATION:

AAPICO Hitech, an original equipment manufacturer (OEM) of automotive parts, which previously forecast revenue growth of 5 per cent this year, now expects it to decline by 10-15 per cent, while profit will also be lower because of the sluggish economy.

However, it says it hopes the economy will improve in the second half of this year under the administration of the military-run National Council for Peace and Order.

The Thai automotive industry this year was adversely affected by various factors such as the weak domestic economy and political instability, which hurt the confidence of foreign carmakers that rely on Thailand as a manufacturing base. Hence many local parts manufacturers expect production outputs this year to fall short of targets. 

Chevrolet Launches Production of New 2014 Captiva in Rayong, Thailand

The first 2014 Chevrolet Captiva drives off the assembly line at GM’s Rayong Assembly Plant in Thailand. Marcos Purty, managing director of GM Thailand (first on right of Captiva) and Michael O. Perez, Vice President, Manufacturing GM Thailand/ASEAN (first on left of Captiva) celebrate with employees at the launch ceremony. 

The Captiva is one of the most successful SUV’s in the market, having sold more than 35,000 units since its introduction in Thailand.

Thailand Auto Makers Bet on Pickup Trucks

Via Kathy Chu, WSJ

Thai auto makers have a secret weapon to combat slumping domestic car sales: Farmers.

Farmers are reliable customers for pickup trucks, which they use to transport crops and machines. Pickup trucks are also popular with miners and construction workers. These groups are boosting sales of pickup trucks in parts of Southeast Asia at a faster rate than passenger-car sales, according to data provider LMC Automotive.

That’s why, with car sales expected to fall in Thailand by nearly a quarter to about 1 million vehicles this year, some auto makers are focusing on selling pickup trucks. Sales of pickup trucks in Thailand are falling too, but less rapidly than passenger cars—by about 20% to 421,574 vehicles this year, LMC Automotive estimates. And demand for pickups in other parts of Southeast Asia still is growing.

[...]

Thai auto sector slams on brakes as political crisis rumbles on

Via Chicago Tribune:

Thailand's auto sector, Southeast Asia's biggest, has fired more than 30,000 subcontracted workers this year and slashed production, as sales plunge after months of political unrest that threatens to drive some manufacturers offshore.

The lay-offs are the latest sign that the auto industry, accounting for about 11 percent of Thai economic output, is being hit hard by the prolonged power-struggle between the Bangkok-based royalist establishment and the mainly rural supporters of ousted former Prime Minister Thaksin Shinawatra.

The crisis deepened on Wednesday, when a court ordered Prime Minister Yingluck Shinawatra, Thaksin's sister, to step down after finding her guilty of abuse of power, leaving a caretaker government to press ahead with plans for a July election.

As a regional production and export base, Thailand's troubles have major implications for top manufacturers such as Toyota Motor Corp, Nissan Motor Co and Ford Motor Co, which may be forced to shift some production to cheaper bases such as Indonesia, the region's second-biggest auto market.

"As political instability continues, we are concerned that automakers may reduce their exposure to Thailand to diversify their risk," said Kovit Wongkolkitsilp, chairman of the auto parts group of the Federation of Thai Industries (FTI).

Honda Motor Co said it was considering delaying the start-up of a new $530 million manufacturing plant in Thailand by six months to a year, as the economy teeters on the brink of recession and political turmoil prompts automakers to rethink their investments.

"It's critical especially in the auto sector. We have seen a big lot of layoffs, about 500 to 700 staff, several times in recent months," National Congress of Thai Labor President Panus Thailuan said.

Toru Hasegawa, Nissan's Indonesia chief, said that "because of the political uncertainty, total industry volume is a bit affected", but he added that Thailand remained a key market for the company.

"They are also a big market and still growing. For Nissan, Southeast Asia is very much important," Hasegawa said.

Rival Toyota said at the start of the year it planned to sell 400,000 vehicles in Thailand this year, but in the three months to March saw sales there drop 33 percent to 84,000.

Toyota Executive Vice President Nobuyori Kodaira told reporters in Tokyo on Thursday that the car maker might have to consider cutting its sales outlook for Thailand as a result.

"Thailand is one of our very important strongholds globally and we have no change in our stance to make vehicles and conduct business there," he said.

[...]

Thai Auto Parts Makers Meet Volkswagen

Via THAI EUROPEAN BUSINESS ASSOCIATION (TEBA):

With Volkswagen, Europe’s largest manufacturer, expanding its presence in Southeast Asia, the company is keen to find the best of Thailand’s automotive suppliers to source parts from. With this in mind, this year’s IZB – International Suppliers Fair is focusing on ASEAN as the exhibition’s partner region. IZB started as an internal suppliers event for Volkswagen but has developed into Europe’s largest automotive suppliers exhibition. TEBA has made special arrangement’s with the organizer to participate with a booth to showcase Thailand automotive suppliers sector.

To present more about the IZB and Volkswagen’s plans in the region, TEBA invited Mr. Kelvinder Singh from VW Group Malaysia to meet with some of Thailand’s top automotive supplier companies recently during the Thailand Auto Parts and Accessories (TAPA) exhibition.

Mr. Singh played a video that presented the Volkswagen Group and its various brands. He then went on to talk about the company’s global presence and sales activities. He also educated the assembled automotive suppliers on Volkswagen’s sourcing and supplier registration process. Other interesting topics discussed were Volkwagen’s future plans in Southeast Asia and especially the company’s plans for Thailand. Volkswagen has now signed up to Phase II of Thailand’s eco car program. The program requires a minimum annual capacity of 100,000 units.